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Wednesday, July 4, 2012

June's Manufacturing Decline Worse Since 9/11

If you haven’t heard the news: stay on vacation, no reason to hurry back. This economy is going nowhere fast. This is the third "summer of recovery" and recovery summer 3.0 is worse than the first. The Institute for Supply Management Index is one of several indicator economists use to measure economic activity. The drop of 12.3 points in the orders index is the largest since October 2001 (when, in the wake of 9/11, the index dropped 12.4 points) and the second largest decline since December 1980. Is anyone paying attention? This is the worst decline since bin Laden took down the WTC. The country is headed into a double dip recession. Bin Laden is dead and so is manufacturing. Catchy campaign slogan, right, Obama?
Of course bad economic news just doesn't happen on this administration's watch. It's George Bush's fault. It's the european debt crisis, it's the earthquake in Japan, it's ATM machines but never team Obama's fault. Assuming the pace of decelerating activity continues, and we make that assumption, it is only a matter of time before the service sector mirrors the real goods slowdown and overall employment gains moves from sluggish to worse. Brace for more bad news when the unemployment data is released on Friday. Reuters forever the pollyannaish cheerleader for the Obama administration sees a rebound in jobs added in June to 90,000. Even that dismal goal may be too much for an economy deliberately sabotaged by regulation, taxation and demagoguery. Enjoy your golfing, Mr. President the private sector is doing fine.